F: Judgment for D (negligent party) -- not liable
Affirmed by AC, and P appeals
D owned a ship named the Wagon Mound which was moored at a dock. P owned two ships that were moored nearby. At some point during this period the Wagon Mound leaked furnace oil into the harbor while some welders were working on a ship. The sparks from the welders caused the leaked oil to ignite destroying all three ships.
No possibility (no.1), Small possibility here (no. 2)
How probably have to be (no.1), some probability just how much foreseeability that you have to have (hand test) Possibility is low, measure of foreseeability directly from (reasonable men pay attention to the risk)
Reasonable men would see the even tiny possibility if it brings the greater risk
it was not custom to dump the oil (easily capable of finding negligence)
I: Whether A reasonable person in the position of the ship’s engineer would have been aware the risk of fire even if the probability of fire was low
R: foreseeability of the consequences of D's actions depend on the balancing btw. the likelihood of risk and the magnitude of damages flowing therefrom.
A: a reasonable person in the position of the ship's engineer would have been aware of the risk of fire.
Since the gravity of the potential damage from fire was so great there was no excuse for allowing the oil to be discharged even if the probability or risk of fire was low.
C: reversed – D liable
Co: This idea of a balance between magnitude and seriousness of risk is similar to that proposed by Learned Hand Reasonable man standard - Ship’s engineer in general (because it is professional)